The Federal Government has dismissed allegations that it spent more than ₦8 trillion outside the 2026 approved budget, insisting that it does not operate a “shadow budget” and that all public expenditure is carried out strictly within Nigeria’s constitutional and legal framework.
The clarification followed recent public commentary suggesting that about two per cent of the country’s Gross Domestic Product (GDP), estimated at over ₦8 trillion, was spent outside the national budget based on references to the International Monetary Fund (IMF) Resident Representative in Nigeria and the Fund’s 2026 Article IV Consultation Report.
In a statement, the Honourable Minister of Finance and Coordinating Minister of the Economy, Taiwo Oyedele, described the claims as false and misleading, warning that they distort the realities of the government’s public finance management system.
“The Federal Government does not operate a shadow budget or expend public funds outside the constitutional and statutory framework established for public finance,” the minister stated.
He explained that under Sections 80 to 83 and 162 of the 1999 Constitution (as amended), public funds can only be withdrawn and spent in accordance with the Constitution and laws enacted by the National Assembly.
According to the minister, federal expenditure is implemented through duly enacted Appropriation Acts, Supplementary Appropriation Acts and other statutory authorities approved by the legislature. He added that multi-year capital projects spanning several budget cycles are executed under existing legal provisions governing capital rollovers and should not be misconstrued as off-budget spending.
Oyedele maintained that allegations of trillions of naira being secretly expended without legislative approval lacked credible evidence, stressing that such claims should identify specific projects allegedly executed outside lawful appropriations.
He further explained that Nigeria’s public finance system includes several legally established expenditure channels that may not appear in the annual Appropriation Act in the same format as required under international fiscal reporting standards.
These, he said, include statutory transfers to development commissions and government agencies created by law, cost-of-collection and administrative charges retained by designated revenue-generating agencies, capital expenditure approved under separate budgets for certain agencies and the Federal Capital Territory, as well as special interventions authorised to address national priorities such as security, infrastructure development, disaster response and other strategic programmes.
The minister also listed debt servicing obligations and other statutory transfers as expenditures expressly authorised by legislation.
According to him, these expenditures are neither secret nor unlawful, as they are provided for by law, disclosed in official fiscal reports and subjected to oversight, audit and accountability mechanisms.
He clarified that differences in the presentation of such expenditures under international reporting standards should not be interpreted as evidence of illegal spending or the existence of parallel budgets.
The government also rejected suggestions that the reported amount reflected an increase in Nigeria’s fiscal deficit.
Oyedele explained that a fiscal deficit is determined by the relationship between total government revenue and expenditure, noting that financing capital projects through annual appropriations, supplementary budgets, statutory transfers or other lawful financing arrangements does not automatically widen the deficit.
He said the IMF’s observations related primarily to the comprehensiveness, timing and presentation of Nigeria’s fiscal reporting rather than the legality of government expenditure.
According to the minister, Nigeria is continuing to strengthen the alignment of its budget presentation with international fiscal reporting standards as part of broader public financial management reforms.
He recalled that President Bola Ahmed Tinubu had, during the presentation of the 2026 Appropriation Bill to a joint session of the National Assembly on December 19, 2025, formally requested lawmakers to eliminate the practice of running multiple and overlapping budgets by adopting a single, harmonised budget framework.
The minister said the Tinubu administration remains committed to prudent fiscal management, transparency and accountability, adding that recent reforms have improved budget credibility, strengthened revenue administration, expanded the digitalisation of government financial processes and enhanced treasury management.
He noted that the reforms have received positive recognition from the IMF, other multilateral institutions, international credit rating agencies, investors and global media organisations.
While affirming that public debate is vital in a democratic society, Oyedele urged commentators to base discussions on verified facts and a proper understanding of Nigeria’s constitutional and fiscal framework.
He stressed that misrepresenting technical observations as evidence of unlawful expenditure undermines informed public discourse and weakens democratic accountability.
The Federal Government, he added, will continue to uphold the rule of law, ensure transparency in the management of public resources and work with the National Assembly, oversight institutions, development partners and Nigerians to strengthen fiscal governance in line with international best practices.
